He said the shift in Russia's position to supporting the eventual deployment of a United Nations force and self-government in Kosovo showed a real peace process was underway.

But, speaking in Germany, Mr Clinton said the chance for a successful end to the conflict depended on Nato firmness, and there was no reason to change the bombing strategy.

Yugoslav UN Ambassador Vladislav Jovanovic: "Many countries support our right to defend our country"

The reaction from Yugoslavia has been cautious. A Foreign Ministry spokesman, Milisav Paic said his government was willing to accept a UN presence in Kosovo but that its mandate and composition should be negotiated between Belgrade and the UN.

Yugoslavia, meanwhile, has agreed to allow a team of UN humanitarian officials into visit Kosovo after a request from the UN Secretary General, Kofi Annan.

The draft peace plan provides for the deployment of "effective international civil and security presences" endorsed by the United Nations, to secure Kosovo after the withdrawal of Serb forces.

The foreign ministers of the G8 - which comprises the UK, Canada, France, Germany, Italy, Japan, US and Russia - adopted the plan at their meeting in Bonn, Germany.

It provides for the return of refugees to their homes and the establishment of an administration approved by the UN Security Council.

Mr Clinton said there could be an agreement without Mr Milosevic being forced from power. The alternative, he said, would be for the international community to declare war and march on Belgrade, which had never been its aim.

The BBC' s Jon Leyne: "Nato is taking nothing for granted"

Russia - Serbia's traditional ally - had been coming under increasing pressure to agree a framework to end the conflict.

BBC Correspondent Caroline Wyatt said the agreement suggested Nato forces might be deployed in Kosovo but not in a leading role.

Russian Foreign Minister Igor Ivanov, answering questions after the agreement was announced, said Nato could not participate in an international security presence in Kosovo without Yugoslavia's agreement.

Caroline Wyatt in Bonn: "No specific mention of Nato's role in peacekeeping force"

"We have written in the principles that we guarantee the sovereignty of Yugoslavia. Without the agreement of that state, nothing is possible," he said.

US Secretary of State Madeleine Albright reiterated that Nato forces - including US troops - must be at the core of any international force deployed.

(Click here to see a map of last night's Nato strikes)

Nato says Yugoslav forces in Kosovo have been largely cut off as a result of air attacks.

David Shukman in Brussels: "!Serb air defences are diminished but sitll active"

All major road and rail routes into Kosovo have been closed and only two bridges across the River Danube in Yugoslavia have not been destroyed, he said.

General Walter Jertz said federal troops were increasingly pinned down and demoralised.

Nato air strikes had, he said, destroyed 20% of Yugoslavia's tanks and artillery.

He added that improving weather had allowed further attacks on police and army units in Kosovo.

John Simpson in Belgrade: "Mr Milosevic's men are already claiming victory"

President Clinton told refugees at the Ingelheim camp that what had been done could not be undone, but they had not been "forgotten or abandoned".

"You will go home again in safety and freedom," he told them.

Rugova security call

The Kosovo Albanian political leader, Ibrahim Rugova, has said an international peace force for Kosovo, comprising troops from Nato and other countries, is essential if refugees are to return home safely.

Speaking for the first time since unexpectedly arriving in Italy on Wednesday, Mr Rugova said Serb troops also had to withdraw from the province but he did not comment on whether he supported Nato's military action.

Mr Rugova did not say whether he had been held under house arrest by Serb forces, as had been reported by his associates.

Border re-opened

The Former Yugoslav Republic of Macedonia says its Blace border with Kosovo has been re-opened and refugees are being allowed into the country again.

Government officials are quoted as saying that the decision to close the border for a few hours on Wednesday was to draw attention to Macedonia's difficulties in dealing with the huge influx of Kosovo Albanians in the past few weeks.

The United Nations refugee agency, says it is seeking assurances that refugees will continue to be allowed into the country.

• Macedonia re-opens border
• Rugova calls for peace force
• Belgrade allows UN Kosovo mission
• Full text of peace principles
• Kosovo Albanians: Who's left?